Article text size

Seeking an elusive, expensive catch: quotas

What really makes business unprofitable for Pacific fishermen? About 70 per cent of the landed value of their catch can go to the holder of an evasive permit

Fisherman Dan Edwards – seen with his boat in Ucluelet, B.C. in December – is part of a hard-working fishing family that included his father and grandfather. A quota system, meant to encourage sustainability and make fishing safer, instead created a new problem: Quotas, it turns out, are more valuable than fish.

Jeremy Koreski/The Globe and Mail

COREY MINTZ

Special to The Globe and Mail

Includes correction

Published March 2, 2018Updated March 6, 2018

Dan Edwards was raised in a British Columbia household of eight kids, supported by fishing – as the family had been for generations.

"It was never an easy life," Mr. Edwards says. "My father and grandfather worked hard. But they made a living – fishing."

A lot has changed since Mr. Edwards's grandfather moved from Newfoundland to B.C. in 1927 to fish for halibut and salmon. Today's fishermen use sonar, fish aggregating devices and computerized navigational systems. And in part because of all that equipment, it often barely pays to go out on the water; between labour, fuel, bait and other equipment, just leaving shore costs between $7,000 and $10,000.

Story continues below advertisement

But what really makes fishing unprofitable for many Pacific fishermen is that about 70 per cent of the landed value (or gross revenue) of their catch can go to pay the owner of the fish. And the owner is not the province, the country, the Queen nor Njoror, the Norse god of the sea.

The effective owner of B.C.'s fish is the holder of the individual transferable quota for catching them. An ITQ is a permit to harvest a certain amount of fish – per species – each year. Introduced in the 1990s, it's a system that many in the industry say has essentially privatized a natural resource, rendering many fishermen oceanic sharecroppers beholden to big corporations.

The effects of the system are stark: The number of fishermen in B.C. has dropped from about 20,000 in 1985 to 5,000 in 2015. And since a fisherman has to pay more than half the value of his catch to the quota holder, it should be no surprise to see B.C. halibut retailing for as much as $35 a pound.

Commercial fishing boats head out on the Fraser River from Steveston Harbour in Richmond, B.C., in 2010. Many fishermen are afraid to publicly criticize the system for fear they’ll be blacklisted from leasing quotas.

DARRYL DYCK/The Globe and Mail

B.C. fishing was a wild west until the second half of the 20th century, when the catch-as-catch-can model transitioned to a series of licences, subdivided by fish species and fishing method.

During the 1960s and 1970s, wildlife management was attempted through seasonal limits. Licensed vessels were allowed to catch as much of a certain species as they could during a set open time with specified gear. The practice, known as "derby" or "olympic" fishing, created enormous safety issues because, with the clock ticking, fishermen were incentivized to take risks and head out in dangerous weather.

The quota system was meant to encourage sustainability and make fishing safer. A quota was granted to fishermen based on previous years' catches, and quota holders had catch limits but could harvest throughout the year.

Fishermen disagree about whether sustainability was improved. Some cite ITQs as a paragon of marine conservation, others as an inefficient tool. Quotas definitely did not solve the safety issue – a recent data project by The Globe and Mail and Statistics Canada determined that fishing has the highest fatality rate of any occupational sector in the country.

Story continues below advertisement

What ITQs did do was create a new problem: Quotas, it turns out, are more valuable than fish. Those who haven't had one handed down as an heirloom over the past two decades must lease one from quota holders, who keep raising prices. According to statistics provided by the charity Ecotrust Canada, the price of a halibut quota rose 190 per cent between 2010 and 2017, from $43 a pound to $125 a pound.

"In B.C., it's become a commodity to be bought and sold," Mr. Edwards said of ITQs. "And the cost of buying it is well out of the reach of most fishermen."

‘In B.C.,’ says fisherman Dan Edwards, seen with his boat, the individual transferable quota permits have ‘become a commodity to be bought and sold. And the cost of buying it is well out of the reach of most fishermen.’

JEREMY KORESKI/The Globe and Mail

Take the big sale this past year by long-time fisherman Wilf Landry, who spent decades amassing a large quota.

"Wilf Landry, when I was a teenager, that guy was out there buying up licences," said Brian Mose, a fifth-generation fisherman and executive director of the Deep Sea Trawlers Association of B.C. "He had a vision that no one else had. He did what he did over 40 years, and don't we all wish we were that smart, with that kind of foresight."

Vancouver fisherman Peter DeGreef said Mr. Landry offered him a portion of his quota – 50,000 pounds of halibut and 100,000 of sablefish – but he couldn't afford it. "Far too big a package for me," said Mr. DeGreef, who fishes for halibut, sablefish and tuna. He estimated the market price for the piece Mr. Landry offered at $12.5-million.

While Mr. Landry has done well by ITQs, he and his peers were outraged when they were introduced.

Story continues below advertisement

"We didn't want it. It was jammed down our throats. Some fishermen were so disgusted that they turned around and sold their quotas. People were bailing out left and right," he said.

He foresaw quotas becoming a valuable commodity, but he never accepted the reasoning behind them.

"It wasn't conservation. And it wasn't safety at sea," said Mr. Landry, claiming the real objective was generating revenue for the federal government in the form of quota fees. "If you've got a million-pound quota and the government's charging you 30 cents a pound, do the math. Before they never had it. There was no charge for taking the fish out of the water. The government did it so they could raise money. That's all it was all about."

Many fishermen are afraid to publicly criticize the ITQ system for fear they'll be blacklisted from leasing quotas – some leases even demand non-disclosure agreements. As for who owns the quotas, that's hard to know too: While Fisheries and Oceans Canada (DFO) tracks the sale of ITQs, the information is not publicly accessible. Some fishermen worry that foreign countries, through shell corporations, are gaining hold of Canada's natural resources.

"Canadian fisheries resources belong to Canada and Canadians," said a DFO spokesperson via e-mail. "The Government of Canada therefore has the responsibility to manage this common property in a transparent way. The general rule of thumb is that quota allocations are public knowledge, but individual catches constitute business records, and are therefore considered private information."

For their part, corporate owners say the value of ITQs is limited. Dan Nomura is president of Canfisco, a division of the Jim Pattison Group, which harvests and processes 120 million pounds of fish annually. He says Canfisco owns a quota for 3 per cent of the halibut, 2 per cent of the black cod/sablefish and 17 per cent of the groundfish, which includes hake, sole and rockfish, caught off the coast of B.C.

"Quotas and licences are not legal ownership, not legal title to Canada's fish resource," he said, noting the DFO can make changes to quotas at will.

Those changes include the Pacific Integrated Commercial Fisheries Initiative, which the federal government began implementing in 2007. With the stated aim of increasing Indigenous communities' access to commercial fishing, B.C. began buying up quota and redistributing it.

A commercial fishing boat fishes for sockeye salmon at the mouth of the Fraser River in Richmond, B.C., in August, 2010.

Darryl Dick/The Globe and Mail

"It doesn't matter how much quota you have," said Nomura. "If the pie itself continues to shrink, then making an investment in more quota licences, equipment, processing, doesn't really pencil out."

For independent fishermen who were not granted quota in the 1990s, there is no getting out from under the system.

Mr. Edwards's family lost access to a number of fish in the 1970s, when multispecies licences evolved into those for single species. This meant they also weren't eligible for quota.

"Near the end of his life, he sold his boat – and he didn't sell it into the family because there was too much uncertainty in the industry," Mr. Edwards said of his father. "He just didn't feel there was any future in it."

His son, a fourth-generation fisherman, kept on until last fall, when he didn't take his boat out at all. Sablefish quota was being leased by a foreign owner for $9 a pound, which exceeded the landed value. If they had taken it, the family would have lost money fishing.

Editor’s Note: An earlier version of this article included a pull quote incorrectly attributed to Brian Mose. In fact, Wilf Landry said: “We didn’t want it. It was jammed down our throats. Some fishermen were so disgusted that they turned around and sold their quotas. People were bailing out left and right.” As well, a previous version incorrectly described the Pacific Integrated Commercial Fisheries Initiative as a B.C. government program. In fact, it was launched by the federal Department of Fisheries and Oceans.

We have closed comments on this story for legal reasons or for abuse. For more information on our commenting policies and how our community-based moderation works, please read our Community Guidelines and our Terms and Conditions.

Due to technical reasons, we have temporarily removed commenting from our articles. We hope to have this fixed soon. Thank you for your patience. If you are looking to give feedback on our new site, please send it along to feedback@globeandmail.com. If you want to write a letter to the editor, please forward to letters@globeandmail.com.